June 29, 2011

Cost savings from worker contributions to health care and retirement, taking effect today as part of the new collective bargaining laws, will swing the Kaukauna School District from a $400,000 budget deficit to an estimated $1.5 million surplus.... The district... plans to hire teachers and reduce class size.

Let's stop and think of all the protesters who carried signs asserting that their opposition to Scott Walker was for the children.

This surplus is just corroboration. There is an inherent lie in the "Children first" horseshit. The first duty of a union is protect its members. Therefore, teachers come first, children are somewhere down the list. This fundamental point needs to be stated again and again.

"Think globally act locally" is what gives you that $400,000 deficit. For the globally-minded elitists in which virtue trumps money, the perfect school district would pay teachers like bond traders and spirit them to their moss-walled eco-classrooms on Disney World monorail.

The complaint I hear from my liberal friends is that the Republicans are attacking unions while letting the bankers off the hook (let us forget, for the sake of indignation, the occupant of the White House).

The problem is that attacking Wall Street helps localities not one whit. The city payroll is where the fiscal damage is done. There are a lot of cities under a lot of water these days.

But think globally and you can pretend that Wall Street is the villain. One of the most debilitating biases of the national news media is the deflection of all issues toward national politics and, from there, the dream of top-down solutions.

I forget where I heard it, I think it was in a comment section of a blog. Regardless, it's true: Whenever anyone says something is for the children, hang on to your freedom and your wallet, because both are about to be assaulted.

Meanwhile, Milwaukee Public Schools announced today that they are laying off 519 employees, 354 of which are teachers. Why? You guessed it...because they rushed through a union contract to "beat" the implementation of Walker's budget repair bill.

Walker gave fair warning to this schools and unions - if you rush through a contract, you are going to get screwed. If you wait until his law passes, you have the ability to shape the budget how you want it with no to minimal layoffs or reductions in services.

This just reveals the impact on the compensation of the effected employees

It isn't JUST the compensation and pension contribution hike. The districts are now also able to go to a less expensive health plan (instead of the Union sponsored and mandated company) with just as good quality of coverage.

In the District where I am a board memeber, we dropped Cal Pers Health insurance, shopped around and ended up with one of the "blues". The employees have essentially the same coverage. They pay for a portion of dependant coverage and the district saved over 10,000 a year PER employee. That 10K PER employee now goes to hiring more people and back into deferred maintenance that had been neglected for years.

Unfortunately we are still chained to the Cal Pers retirement plan, however the employees now pay THEIR portion of the deferral, slightly more than 6% of compensation, which the District had been picking up. This also saved additional thousands of dollars per employee.

The District still pays as an employer contribution over 18% of payroll to cover current employees and to pay for the actuarial shortfalls due to Cal Pers tanking along with the rest of the markets performance.

Now we are running a postive cash flow in addition to being able to take care of all of the above.

The scenario in the schools in Wisconsin is not at all unusual, when you can CONTROL and MANAGE your finances in an INTELLIGENT and RESPONSIBLE manner. Without Union's extortion.

Henry - "The problem is that attacking Wall Street helps localities not one whit. The city payroll is where the fiscal damage is done. There are a lot of cities under a lot of water these days.

But think globally and you can pretend that Wall Street is the villain."

Small towns, cities have little to do with the policies that have gutted American industry leaving much of America as a rotten husk of what it once was. Wall Street and globalization and free trade with nations that have 1/16th the labor wage of America - does. That has caused a significant jobs collapse and revenue loss in municipalities.They have little to do with their government indebting us to China, or the trillions lost in the Wall Street bailout. That money lost to Goldman Sachs, the German and CHinese and Japanese investors in AIG is lost to developing American infrastructure and business.

Wall Street is one of the partners in the cabal that wants Open Borders, free transfer of American technology to other nations (as long as the multinationals benefit by giving it to their host Pakistani, Chinese, Indian enterprises).

Now I have other things to think about. I got an idea for a page that can be used in a card. The page will be grasshoppers in a mature wheat field. That was the main idea: how to depict a field of wheat artistically using pop-uppery. It seems straightforward. A weird smiling sun comes up in the back. At first the sun is concealed behind the wheat but it arcs 45º upward to full noon. I already devised a way that uses a concealed lever underneath but the arm holding the sun moves in the wrong direction when the card opens so on the back of the card I devised a lever system that transfers movement to the opposite direction using another lever connected to a third lever. But when I finished I realized all those levers were total overkill. I can get a 45˚ arc using other mechanisms, so I tried one that I studied in my copy of Il Était Une Fois It too is unnecessarily complicated. Now I'm thinking about the simplest method possible and I'm eager to try it.

There are some questions that need to be addressed before the Republican victory dance can begin in earnest.

1. Is the result for this district a quirk or will similar but less dramatic results obtain statewide?2. Is this a one off savings or will the savings persist from year to year? (Don't spend all that money yet, school board.)3. Will the money be well spent or wasted?4. Do taxpayers get a chunk of this? Where are the lower taxes?

Well great - they're going to hire more teachers, who will become tenured. Then the economy wiill finally recover, voters will feel better (and guilty), vote in some Democrats and you're right back where you were, with MORE public union employees.

Did it ever occur to the school district to return these new-found cash flows to the residents by LOWERING THE TAX RATE?

There will be more announcements coming, as schools actually do their math with the new formulas, and it will demonstrate loudly and clearly...those that looked out for the unions will be laying off and cutting back on student services.

Those that waited and actually, really, honestly conducted a 2 party negotion will look like this story.

The next most interesting story will be the numbers that actually choose to join the union and elect to pay dues. Those numbers are going to shock the socks off the union higher ups.

Also, received an email from union today, announcing that global unions have selected Wisconsin to pour in funds and help fight Gov Walker and recalls.

"1. Is the result for this district a quirk or will similar but less dramatic results obtain statewide?"---------------

Every district will be different because they all receive different amounts of state aid, but I feel that the large majority of schools that have acted responsibly in this whole situation (i.e. havent pushed through new union contracts) will have similar results.

2. Is this a one off savings or will the savings persist from year to year? (Don't spend all that money yet, school board.)---------------------------

Why wouldnt the savings persist? The law allows school boards to adjust their contracts accordingly due to the lack of collective bargaining privledges. And it allows them to shop for health care plans that fit their school and budget.

3. Will the money be well spent or wasted?-----------------------

I would say adding good teachers will be money well spent. But this point here will be the key to the long-term success of public schools in Wisconsin due to the new law changes.

4. Do taxpayers get a chunk of this? Where are the lower taxes?----------------------

Its already been stated that, because most schools will have to operate with a much lower budget, the property tax rates in most districts will indeed be lower, as the tax revenues will exceed the amount schools will be allowed to spend.

Did it ever occur to the school district to return these new-found cash flows to the residents by LOWERING THE TAX RATE?

They may consider that at some time in the future, however, it is a long and complicated legislative process and may require waiting until the next general or special election, put it on the ballot and let the people in the District vote. (at least that's how it works here)

Plus a portion of the taxes, (from property tax in Wisconsin???), are also earmarked for other things like Hospitals, Fire Dept, County and State uses. Do you think those entities want to rebate the money. I doubt it.

They can't just willy nilly give the money back without the legal process. Plus if you give it back now, you might need it later. Better to build up some surpluses for now.

"If you read the article, the money saved comes from the requirement for staff to pay more for health care and pensions. These were changes that the teacher's union AGREED to. These savings did not come from busting unions."

A history rewrite so soon? There were no, none, nada, zero demonstrators at the state capitol -- or was he wrong about that? Althouse needs to tell us again why the "Dim" senators went to "Illinoise."

"If you read the article, the money saved comes from the requirement for staff to pay more for health care and pensions. These were changes that the teacher's union AGREED to. These savings did not come from busting unions."----------------------------

Yes...the money saved THIS YEAR will be from concessions the union already agreed to. However, the elimination of collective bargaining will allow the savings to actually stay in place.

Does anyone REALLY think that WEAC would continue to let union members pay that much in pension and health benefits in future budgets? Without a SIGNIFICANT increase in wages? Especially as the economy comes back?

Some of the comments here suggest that nothing whatsoever was learned here.

Seems like the last option to be considered is lowering taxes. That guarantees it will not be done, and the surplus will be spent because there is always some important need that only government can address, and in exactly the same way they did before.

If the mostly conservative commenters here don't see this mistaken perception, then I sure can't expect future votes that will include the left to control spending.

If it being about the children was a leftist lie, then it being about fiscal responsibility was a right wing lie...apparently.

If a company was busted overcharging customers and delivering shoddy goods, would it makes sense for them to repay the victims by giving them gift certificates to the same stores that ripped them off. Is that what the victims would want if they were intelligent?

A sterling example of public school education. This man is blind to fafct. Cedarford, Wall Street IS Main Street America. The larger companies in the USA are almost all publicly owned, hire our friends and neighbors and retirement plans across the country include their stock in investment portfolios. They are required by law to be mindful of their fiduciary duty to the stockholders to operate their companies at a profit for the owners (stockholders).

It is the American government - full of elected officials who are clueless about business - who regulate these companies, interfere in their business decisions and let the Fed manipulate the interest rates to strangle interest income for the retirement portfolios. There may be bad apples in corporate America but by and large the market is self-correcting. If the cost of doing business is driven so high by the government that relocation will be beneficial to the companies, they are not to blame for doing what the law requires them to do - the government is to blame for making it impossible for the company to stay where it is.

Honestly, do you think any company would disrupt itself to that degree willingly? You're deluded, if you believe that. I remember what happened when Gilbarco got priced out of West Springfield (MA) in the early 1960s, hit with higher business and property taxes and a union contract that threatened to bankrupt them. A lot of my friends moved to North Carolina, some of the other kids' dads lost their jobs, and the town lost a sterling corporate presence all due to government and union greed.

Sure, they will TRY to hire more teachers. However the teachers,in a show of SOLIDARITY and to send a "screw you" message to the evil Koch brothers, will refuse to take the jobs. Nice try WI. But the teachers are on to your whole eduction first priority not teacher benefits nonsense.

Me: "They can't just willy nilly give the money back without the legal process. Plus if you give it back now, you might need it later. Better to build up some surpluses for now."

Actually, yes they can. They can say, right now, "We're holding this excess cash flow in reserve against a planned referendum to consider lowering the tax rate."

Not the same thing as 'giving back' is it, now. Reserves ARE good.

Instead they immediately announced how they will spend the savings

Being in a District that is required to:

1. maintain reserves, which we were never able to do before, in order not to default on our municipal bond covenants (have our bonds called)

and

2. had a significant backlog of deferred maintenance (or in the case of the schools a lack of teachers to student ratio or equipment that needed to be replaced)

and

3. Being a financially minded person, former loan officer, financial planner, investment advisor........I see no logical or rational reason to IMMEDIATELY return the windfall of excess income to expenses. Put into reserves...yes. Return. No way.

Instead a prudent business person would spend the excesses where it has long been needed or neglected.

I don't know if THAT is the case in these school districts is Wisconsin, however.....that is what I would do in the short term, until the situation stabilized and we know what the true cash flow is that could be counted upon.

I live in Kaukauna. And i am laughing my ass off. A bigger group of whiney teachers don't exist anywhere. Except maybe Madison, Milwaukee,DePere, Green Bay, etc. etc. etc.Unfortunately our district will find a way to spend the savings and then some. They always have, always will. We won't see any tax cuts. But for today Walker won, and i love it love it love it

"Instead a prudent business person would spend the excesses where it has long been needed or neglected."

First, there are no prudent business persons in government, that's why it makes sense to give it to prudent business people (tax cuts) instead, or at least use it to set up more privatized education (prudent business people).

Second, has there ever been a time in the history of government budgets when bureaucrats did not think it made sense to "spend the excesses where it has long been needed or neglected," regardless of whether that excess money or the needs really existed. This is a constant regardless of the financial situation, and it's human nature which requires wisdom and leadership to overcome. Otherwise it will spend every cent and then some. Is there a case of the opposite happening?

I wonder how much money is being saved because of retirements -- tons of teachers retired in Madison, and they're replaced by cheaper people, generally. They even had administrators retire! One can hope they will not be replaced.

This thread appears to be dead...but here is another savings. Many school teachers don't want to contribute to their generous benies, so they are retiring instead (most can retire about age 55). So therefore school districts won't have to pay older teachers $58,000 (plus benefits), but can hire a recent college grad for about $42,000. That $16,000 (for each teacher) is a lot for a small school district.

I believe abs are the most important thing in the worldBefore you're 45, you're going to have to choose between your waist and your face. (Or eat too much and lose both). And you'd better start flossing.

Cut the workers pay by over 18% and of course there will be a surplus - that isn't news at all. The real question is will the children receive quality education with the district paying rock-bottom wages? Only time will tell...

Well, Ms. Althouse, I did my mere 5 minutes of homework, and went back to the original source which was the Appleton, Wisconson Post-Crescent.

There I found the following two quotations:

"The Kaukauna School Board approved changes Monday to its employee handbook that require staff to cover 12.6 percent of their health insurance and to contribute 5.8 percent of their wages to the state’s pension system, in accordance with the new collective bargaining law, commonly known as Act 10."

AND:

"In April, the school board rejected a proposal from the Kaukauna Education Association to extend the union’s contract and incorporate pension and healthcare concessions along with a wage freeze, a move the union projected could save the district about $1.8 million next year."

In other words, the Union was perfectly willing to make similar concessions on it's own for potentially, an even greater surplus.

Now, I don't suppose that bothers you in the least. But you, the Kaukauna School Board, and the Governor of Wisconsin could at least get off your high horses and admit that merely breaking the union was enough to justify Act 10.

Or maybe not you, unless you actually did the 5 minutes of homework and learned what happened prior to the fanfare of trumpets.

Hi, I'm a Mathematics teacher in Tennessee. We don't have a fat benefits package like the one enjoyed by the teachers in WI (we pay approx. 20%.) Our salaries are also not up there with those in Northern states (I make about 60% of what my counterpart in Michigan makes, for example.)

Even after all the supposed cuts Walker was making, they are still making out like bandits. All the wailing and gnashing of teeth made the whole profession look bad. In fact, if you're going to act like that, you're flirting with losing the right to call yourself a professional.

I'm not a member of the union but will join a professional organization which provides extra insurance and access to legal council should I need it.

Chuck66 said... I am in Western Wisc right now and Shelly Moore ("THEY WILL RESPECT US") is running commercials non-stop claiming that Shiela Harsdorf voted to cut education by $800,000,000.

I'm also in Western WI, and I listen to WEVR out of River Falls. The only commercial that is presently running, is the one from Harsdorf. That's where you hear Moore declare: "they will respect us" and "they call us the WI mafia." I haven't heard a Moore commercial in weeks. Not one.

Purplepenguin, get the facts first please. Kaukauna teachers earn rock bottom?? Excuse me, but they are one of the highest paid districts in the state. I have a family members teaching in Kaukauna, shes been there 10 years, her base without benefits is 69000. Another family member teaches in a different Fox Valley district. She's been there 8 years, her base is 43000. Two other family members in two different area districts are at the 69000 base, but they have been there 30years. Kaukauna teachers are notably over paid in comparison to the rest in our area.

Joseph Marshall's big gotcha story suggests a couple of different interpretations:

1. The union cheerfully threw its members' pay and benefits to the wolves in order to concentrate on its main priority: perpetuating itself.

2. The union and its members alike were resigned to the fact that they were going to lose money at least in the short run, but if they managed to keep collective bargaining intact they had a good chance of getting it all back later when the budgetary heat was off. This story makes the union look better, at the cost of affirming that Act 10 really does save money.

First, this idea of "perfectly willing" is crap. They were perfectly willing ONLY with the BRB staring them in the face. Those concessions would never have come otherwise. And without the elimination of non-wage collective bargaining, the savings would have quickly faded like a fart in the wind.

BTW, the saving you talk about has this caveat "the union projected could save". First, it's the union saying it, and second, "could" ain't "would".

purplepenquin said...Cut the workers pay by over 18% and of course there will be a surplus - that isn't news at all. The real question is will the children receive quality education with the district paying rock-bottom wages? Only time will tell...

As has been stated the district pays high wages versus others. But let me add that no pay was cut. As a matter of fact, $300K of additional merit pay is now available.

Common theme with you, present bullshit as facts, frame your argument from there.

I wonder if all those new teachers will voluntarily contribute to the union? Why would you contribute to people who essentially want to eliminate your job so they can save a few dollars on their benefits package.

I wonder if all those new teachers will voluntarily contribute to the union?

Watch the union go all capitalist marketing here this next year with various plans to separate their members from their money. Most likely, they will start offering reduced "prices" if you pay the whole thing up front. Also as likely is reduced total cost if you set up auto-deductions. Either way, they will get less than they would have before AND they will have to outlay more cost in administrating their own funds because the state's no longer doing it.

It never should have to begin with. If you want to make the case for public sector unions, fine (though I and FDR would disagree with you). But why should the taxpayers have to handle payroll deductions? Why can't the adults inhabiting the union's rolls and the union itself manage that on it's own?

We could fix our budget problem if we could unleash Paul Ryan. Sadly, the stupid and corrupt democrats and some spineless repubs won't let that happen. After all, we wouldn't want to fix this mess with a real free market solution. Nah- we need more tax payer bailouts to democrat insider cronies, more gov spending and a bigger welfare state.

While we’re at it here is today’s Columbus, Ohio Dispatch on the equivalent law in Ohio:

“They dubbed it the “million-signature march” and then delivered, literally.

“We Are Ohio, the coalition leading the effort to repeal Senate Bill 5, directed a parade of thousands through Downtown yesterday that culminated in the delivery of nearly 1.3 million signatures to the secretary of state to place Ohio’s new collective-bargaining law on the November ballot.

“The exact signature total – 1,298,301, or an amount equal to nearly 1 out of 6 of Ohio’s 8 million registered voters – obliterated the previous state record of 812,978 set in 2008 on a proposed casino for Clinton County.

“It’s a virtual lock that enough valid signatures of registered Ohio voters were collected to place the law before voters on Nov. 8, because only about 231,000 are needed to trigger the referendum. It’s up to county boards of elections to validate signatures in each county, and Secretary of State Jon Husted will validate the total by a July 26 deadline.

“Meeting the threshold of valid signatures also would stop the law from taking effect until after the November election.”

In Ohio, we’re going to take it down, in the legal and correct way, and then put a stake in it’s heart. For good.

Finally, for the record, Appleton, WI had 78,086 people in the 2010 census, a mere 321.5 violent crimes per 100,000 population, and a mere 7.3% of its families below the poverty line. It even will shut down its entire transit system for the July 4th Holiday.

Sounds like idyllic America to me.

The second largest employer in town is the Appleton Area School District. The district spends $9,403 per pupil and has 16 students for every full-time equivalent teacher. It had a grades 9-12 dropout rate of 1% [!!!--ed.] in 2005. And it even has a full 16 charter schools under it's purview.

This hardly sounds to me like a school system on the brink of collapse due to the rapaciousness of it's teachers union.

Recall Elections are scheduled on July 12 and August 9 in Senate District 2 - Brown, Oconto, Outagamie, Shawano and Waupaca Counties, which includes Appleton. So we will soon get to see what the voters there think of it all.

There are 9,765 public workers in Outagamie County. Under the just passed state budget, each will lose about $2,845 in take‐home pay. This will reduce local buying and economic activity by $27.8 million. This is in addition $3.4 million the Kaukauna Area School District lost through direct budget cuts. Was it a good trade?

"jimspice said...There are 9,765 public workers in Outagamie County. Under the just passed state budget, each will lose about $2,845 in take‐home pay. This will reduce local buying and economic activity by $27.8 million. This is in addition $3.4 million the Kaukauna Area School District lost through direct budget cuts. Was it a good trade?"

You do understand that the same dollars have not been taken out of the economy through either:

1)taxation that would have been necessary?

2) The elimination of jobs to offset these now mandated contributions?

Let me answer that. You don't. Which makes you an idiot. Glad we could clear this up.

There are 9,765 public workers in Outagamie County. Under the just passed state budget, each will lose about $2,845 in take‐home pay. This will reduce local buying and economic activity by $27.8 million. This is in addition $3.4 million the Kaukauna Area School District lost through direct budget cuts. Was it a good trade?

And that's why we should pay every teacher $250,000 per year....shoot make t $500,000!

It will all come back to us in higher wages, more jobs, smarter kids, brighter teeth and a cleaner environment.

jimspice - the novel idea is that the money actually stays with original earner and they get to spend it.

You act as if it only counts as spendable income if it's first given to the teacher and they spend it. It counts if the plumber, electrician, babysitter, lawyer, minister etc. gets to keep it and spend it themselves where they see fit.

The problem is that attacking Wall Street helps localities not one whit. The city payroll is where the fiscal damage is done. There are a lot of cities under a lot of water these days. Review AC Contractors

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